Amendment proposed (this day): 30, in clause 1, page 2, line 1, at end insert—

‘(6A) The ISC shall be supported by a body to be known as the ISC Secretariat about which a memorandum of understanding under section 2 may make further provision.’.—(Dr Julian Lewis.)

Question again proposed, That the amendment be made.

I was saved by the short adjournment, which has allowed me to have a look at the amendment that the hon. Member for New Forest East tabled. As I recall, he used the example of the National Audit Office, which provides a secretariat for the Public Accounts Committee, and suggested that a similar arrangement could be made for the secretariat of the Intelligence and Security Committee. I had a look at the National Audit Office, which is much more than just the secretariat of the Public Accounts Committee. It is a big organisation, with a 900-strong staff and a budget of £88 million in 2012. The example does not follow exactly, but I understand what the hon. Gentleman means and there is some merit in considering such a model for the support required by the ISC. It is, however, important to ask questions about its exact structure and the costs of running such an independent organisation—human resources and administration costs—from the best value angle.

The Government often talk in not the most positive terms about quangos. If this organisation were a non-departmental public body, it would effectively be a quango, and the Government want to reduce, not increase, quangos.  Across Government, there is an appetite for bringing matters in-house, rather than creating new bodies. I recognise that the Government may not be sympathetic to the amendment, but I think it has some merit, although it needs more meat on the bones in relation to exactly what it would do and how much it would cost.

At the moment, the Select Committee on Defence deals with top secret matters and classified information in Parliament. As I understand it, the arrangements for the staff of that Committee are different from those for the staff of other Select Committees. There might therefore be a possible arrangement under which Parliament supported the ISC, and I want more information and evidence about how that might work. Again, we have to consider costs, and what the budget might be. As I said earlier, the parliamentary authorities have concerns about finding a 25% budget cut within this Parliament and, if the secretariat moved into Parliament, about exactly how it would work and where the money would come from, which is important. Bearing in mind what has been said about the additional responsibilities that the committee will take on, it would be helpful if the Minister set out his thinking on where that extra support and resources will come from.

I am a member of the Public Accounts Committee. The Public Accounts Commission recommends how much money the Treasury should give Parliament to pay for the National Audit Office. My hon. Friend or I might suggest such an arrangement to the Minister as a possible way forward. It can leave the Treasury open to certain suggestions, but it is done very well and sensitively. The hon. Member for South Norfolk (Mr Bacon) has been involved in that for many years, and it seems to work well.

I thank my hon. Friend for that sensible suggestion, which is certainly worth looking at.

Further to that intervention, I believe that the ISC envisages something very much along those lines—that the ISC would negotiate with the Government on what money and resources should be allocated to the unit. That is the way in which that would be determined.

All those suggestions are very helpful in finding a way forward and I am sure that the Minister will want to talk about what options the Government have been looking at and what their favoured proposal is. There is merit in amendment 30; it is a way forward that I think members of the Committee could support.

Several separate issues are wrapped up in this debate in relation to amendment 30. The substantive issue concerns the secretariat arrangements that would be put in place for the ISC, and, separately there is the matter of whether there should be some reference to a secretariat in the Bill.

On the latter, I would argue that, even if the wording that my hon. Friend the Member for New Forest East proposes were reflected in the Bill, that does not address  the principal issues that we have been debating about the right format and form of support that the ISC should receive for its activities and members, and in delivering the reports and inquiries that are intrinsic to its activities.

It might be worth highlighting to the Committee what the Government said in their original Green Paper, which I think gives a sense of where our emphasis lay:

“The most tangible, physical demonstration of independence and a natural consequence of the ISC becoming a Committee of Parliament would be to make arrangements with the parliamentary authorities for the ISC to be accommodated in suitably secure premises on the parliamentary estate rather than on the government estate. Similarly, its staff could have the status of parliamentary staff (rather than departmental civil servants based in the Cabinet Office) and its budget funded directly from parliamentary appropriation rather than the Cabinet Office’s departmental budget”.

That gives the background and the emphasis to what we believe is the appropriate way to proceed in respect of the secretariat’s support for the ISC in its new form as a statutory Committee of Parliament. The intent behind that passage was that resourcing the ISC should be of a piece with the changes that we intended to make to its status and perceived independence from Government, and the reforms to make the ISC a statutory Committee of Parliament. It was in keeping with that that we set out in our Green Paper the proposal, on which we seek to advance discussions to finalise and formalise it.

It is right that there have been informal discussions with the ISC and the parliamentary authorities, as mentioned in the Clerk of the House’s letter to the hon. Member for Kingston upon Hull North.

My hon. Friend the Member for New Forest East has highlighted issues about the practical arrangements for security and staffing. We believe it is possible to work through those details with the parliamentary authorities.

At an earlier stage, the House service asked us to clarify whether, were it to be decided that the ISC staff would be parliamentary staff, they would be employed by and answerable solely to the relevant corporate officer: the Clerk of the Parliaments in the Lords, or the Clerk of the House of Commons, and not to the Cabinet Office or any other part of Government.

We reassured the House service, and I can provide the same reassurance to the Committee that, if we were to make this arrangement, that would be the Government’s intention. Part of the problem that my hon. Friend the Member for New Forest East has highlighted is that, if we are to ensure that the ISC has that grounding, status and sense of independence, it is somewhat incongruous for the support structure to be an arm of Government. That is well understood and recognised, and we want to address that as part of the reforms that we are advancing, hence my specific reference to what we had said, referring back to the statements in the Green Paper.

We highlighted the security concerns in the debates this morning, because the ISC has that essential role of reviewing classified documentation. Therefore, whatever the form taken by the secretariat, as the Security Minister, I clearly want to know and be satisfied that the arrangements for retaining and handling such sensitive documentation are in an environment that does not endanger the important protected-marked information that underpins virtually all the ISC’s work. That is absolutely clear, and  such things of course come with a cost, but that cost will have to be borne, wherever the ISC is accommodated. Yes, I recognise that the issue will be addressed in whatever structure for the secretariat functions for the ISC that the Committee and the House agree.

My hon. Friend proposed a different model. Instead of the parliamentary authorities hosting the secretariat, bringing it more into line with other Committees of the House, should we be considering a different model that clearly recognises the inappropriateness of Government, or an arm of direct Government, being the secretariat, and should we therefore have a different mechanism? My hon. Friend suggested a non-departmental body, drawing an analogy with the National Audit Office.

It is easy to talk about things in theory, and we seem to be reaching some broad consensus, but there are practicalities about the career path of people doing that job. I have no idea exactly what that career path would be, but there are things to do with their pensions and rights and with whether a separate secretariat could take such pay and conditions details into account. I am sure that the Minister’s officials are looking into the matter, but I just reiterate that point.

The hon. Lady makes an important point about ensuring that the secretariat staff have that sense of assurance and of the role that they maintain. Obviously, we are seeking to transfer the responsibilities to the House, to Parliament, but it is important that part of the detailed arrangements being discussed by officials and the House authorities is recognition of those reassurances, of promotion and of a sense of certainty for staff. I genuinely take on board the point that she flagged up.

My hon. Friend the Member for New Forest East drew a parallel with the National Audit Office, which works on behalf of Parliament and the taxpayer to hold Government to account for the use of public money and to help public services to improve their performance. The ISC secretariat and the NAO both perform extremely important functions but, as highlighted by the hon. Member for Kingston upon Hull North, there is clearly a big distinction between them in scale and, in some ways, in the nature of their activities. The hon. Lady referred to the NAO having about 900 members of staff—my information suggests about 850, but it is big, we can both agree on that. Parallels can be drawn, but I am not sure that that is necessarily the right way to look at the matter, given the costs, overheads and support that an NDPB would be required to have in place, and the proportionality of that.

Our objectives are to make the staff of the ISC secretariat parliamentary staff, in keeping with our overall aim of making the ISC more parliamentary and moving it away from Government, while ensuring that it has the resources it needs to be effective in its oversight role and to keep secure the highly sensitive information it receives. We believe that we will be able to reach an arrangement that satisfactorily meets all those objectives.

I hear what my hon. Friend said about the memorandum of understanding, which is the subject of continuing discussions between the Government and the ISC. This may be an issue that can be dealt with or addressed in some way within the memorandum of understanding,  but, to return to my initial point, I believe that the amendment is unnecessary. What matters is getting the details right. If we look at the ISC as constructed under the existing statute, it does not have provisions dealing with the secretariat even now; yet whatever we say about the nature of that secretariat, the ISC has that secretariat and the Government acknowledge and recognise the ISC’s need to have that support to conduct its duties.

I recognise the need to get this right. Detailed discussions are ongoing, and I want to ensure that we reach a conclusion that satisfies the House regarding the scrutiny and activities of the ISC. I want that to develop quickly, such that we can return to the House on Report and provide the clarity that the House needs. I suggest to my hon. Friend that the amendment is not required, and I hope that he will acknowledge the Government’s genuine desire to work through the arrangements with the ISC and the parliamentary authorities, so that we can deal with detailed points that will make the difference in ensuring the robustness of the ISC’s scrutiny.

My hon. Friend the Minister has made a valiant attempt to win me over and he has half succeeded, but half success is not quite adequate to deter me from testing the Committee’s opinion. It is absolutely the case that the secretariat should not remain under the Cabinet Office’s control. I do not think I am stretching the elastic too much if I say that, on at least one occasion, that caused a serious conflict of interest. I think every member of the Committee thought that that was not acceptable, even under our existing arrangements, before we become a Committee of Parliament, let alone afterwards.

The Minister made a case to show that the Government are oriented towards the parliamentary route. We are concerned about the fact that the parliamentary authorities would not be able to satisfy themselves that the staff they employ would be using the resources for good purposes, because the staff would not be able to confide in the parliamentary authorities what they were using the resources for. Sometimes, they would not even be able to tell the parliamentary authorities what they were examining or investigating.

I understand, of course, the wish to follow the model of other parliamentary Committees, but the reality is that the work that the staff secretariat does for the ISC is very different. It is much more onerous and expensive, and I think the parliamentary authorities would resist approving the required expenditure. In addition, the staff secretariat is seriously understaffed: we have eight members of staff, whereas, for example, the detainee inquiry had 14 staff, the Iraq inquiry had 20 staff and even the Committee on Standards in Public Life has 12 staff. We will need to consider and approve an increase in staff numbers for the ISC, and we feel that that will be a difficult case to make to parliamentary authorities in whom we cannot confide the nature of the work that is going to be carried out.

Although I may not have completely persuaded my hon. Friend—I think that was his opening comment—will he reflect on my point about the separation of the secretariat of the ISC and Government and the reassurance point that I alluded to in my comments?  Does he accept that, in effect, legislating for a secretariat might be construed as making this body seem closer to Government than to Parliament? What might be the impact of that?

The Minister makes a good point, but the amendment is designed simply to flag up the importance of making special arrangements for this particular secretariat to a particularly specialised Committee. If the amendment is carried, and if the result of the negotiations is a decision to go down the parliamentary route rather than the separate route, on the model of the NAO at a smaller scale, that will be perfectly capable of being incorporated into the memorandum of understanding.

The amendment would probably not have been necessary if the Government had pulled their fingers out and reached an agreement earlier. The ISC has been trying for months to reach agreement on this matter. The statistics I quoted about the numbers of staff were taken from a letter from the Chairman of the ISC to the National Security Adviser, Sir Kim Darroch, written as long ago as 4 July 2012. We feel that this matter has been allowed to drift long enough and it will help to concentrate the Government’s mind if it is made clear in the Bill that the arrangements for the secretariat should be incorporated in the memorandum of understanding.

With the greatest respect to my hon. Friend the Minister, I would like to test the opinion of the Committee on the amendment.

Question put, that the amendment be made.

The Committee divided: Ayes 8, Noes 11.

Question accordingly negatived.

Question proposed, That the clause, as amended, stand part of the Bill.

It is important that we debate the clause, because it involves some issues that we touched on but did not fully explore during our debates on the amendments. I made it clear when we discussed the first group of amendments that the Opposition broadly support the aims of the Government in their changes to the Intelligence and Security Committee. The debate so far has been well informed and the Bill has been improved by the amendments that have been made.

As I said this morning, over the past 20 years, the demands on the security agencies have changed beyond recognition, and so has their relationship with the public. The agencies have found themselves under unprecedented public scrutiny, but they have also found themselves newly dependent on the public as they battle the emerging challenges of domestic extremism. As Baroness Manningham-Buller explained in the other place, the security services’ most vital resource is the co-operation of the public, particularly that of members of the communities in which extremist groups operate. The agencies have coped admirably with the changing demands on them: they have opened themselves up, developed new procedures and responded to emerging threats to our country. I remind this Committee of the contribution made in the other place by Lord Reid of Cardowan, who talked of the thousands of lives saved by the work of the intelligence and security services. Now, we need to create an arrangement where the governance of the agencies matches the progress that has been made over the years.

We accept that the ISC has played an important part in that reform. As we have heard, the Committee has grown in stature and gained the trust of the agencies, and we must now ensure that no changes we make during the passage of the Bill undermine that relationship. However, the Opposition believe that more could be done to increase public understanding of the ISC, because it is important not only that it does its work, but that it is seen to work effectively, so although we support the direction of the clause, we think it could go further. If reform were brought about in a different way, the ISC might be better seen and understood by the public without losing its effectiveness and the effective relationships it has with the intelligence and security agencies.

The other place considered for many hours whether the ISC should become a Select Committee—Lord Campbell-Savours in particular took a firm view. It is worth our considering what that would mean for the ISC, in the light of remarks this morning about providing some statutory protection if the ISC became a parliamentary Committee. It is important to look at Select Committee status, first, because that would increase public understanding and confidence in the ISC. The public understand what Select Committees do: they understand the concept, they know what the role is and they understand that it is a clear part of parliamentary work.

The Government wrestled in the other place with what they want the ISC to be. There was debate about making it a parliamentary Committee and some debate about Select Committee status. The powers that be have been discussing this matter for some time, but I believe that agencies, potential witnesses, Members of Parliament, the press and the public will be confused by the way in which this new hybrid type of Committee is established as a Committee of Parliament, but not a Select Committee. That uncertainty and potential confusion could lead to legal challenge, which worries me.

The second major benefit of the ISC being a Select Committee is that parliamentary privilege would clearly be bestowed on its members, staff and witnesses. We talked about parliamentary privilege this morning. In his letter, the Clerk clearly set out that parliamentary privilege is not a limited right but is an absolute right. One of the matters we discussed this morning was the importance of certainty for the ISC, so that it can be  sure it has all the protections it needs when carrying out its work. If the ISC were a Select Committee, all those associated with the ISC would know where they stood and what their rights were. Although this Committee has agreed to, and we support, the establishment of the ISC as a parliamentary Committee, there are some problems.

Earlier, we saw attempts by the Government to pull out the best bits of a Select Committee’s operations to offer protection to witnesses and to give the ISC various powers and protections. Those are steps in the right direction but, as I said, some problems remain. Members of the ISC are appointed as parliamentarians—only parliamentarians can sit on that body—to a Committee named as a Committee of Parliament, but in fact they will not be acting as parliamentarians when sitting on that Committee. They do not get the privilege that being a parliamentarian usually attracts. I am also concerned about the Clerks who support the Committee and their protections, which was alluded to in our earlier discussions.

If Select Committee status were bestowed on the ISC by the House of Commons and the House of Lords, it would offer an alternative to the route we are taking now and avoid the pitfalls. Privilege would cover all the actions of ISC members while serving on the Committee and the staff serving the Committee while they were carrying out the functions of supporting the Committee members. Witnesses would be offered protection in their written and oral evidence: if unsolicited evidence was supplied to the Committee, it would be able to evaluate it before deciding whether to accept it as evidence, making it clear where protection for whistleblowers was provided while ensuring that unscrupulous evidence and leaks could be challenged. The Committee could also call witnesses, compel them to give evidence and sanction those who misled it.

I refer again to the excellent advice from Sir Robert Rogers. He said clearly that it was possible to create a Select Committee while offering the type of protections that the Government are concerned about in establishing such a body. Sir Robert makes it clear that the only way in which the ISC could assert privilege would be for it to be made a Select Committee. In doing so, he sets out clearly that protections would be available to deal with some concerns.

For example, any resolution before the House of Commons and the House of Lords to establish a Select Committee could state that membership was to be dependent on nomination by the Prime Minister, that the presumption would be for the Committee to meet in private or that the Prime Minister retained the right to redact information from any Committee report. Special Standing Orders could, therefore, be produced to form a Select Committee—it would be different from the usual ones in the House, but it would have the full range of protections, about which most people are concerned.

As we know from Sir Robert’s letter, a Select Committee cannot be created through statute; that has to be done by resolution of the House of Commons and the House of Lords, decided by all parliamentarians. If we go down the line of setting up a Select Committee, the way forward would be to reject most of clause 1 and to create it elsewhere through the procedures of the House. I want to make it clear that the Opposition do not intend to do that at this stage, but we need to make it  clear that there is an alternative way of doing everything we want to do in creating an ISC that is a parliamentary Committee with all the benefits of such a Committee, but which cannot be challenged in the courts. That is our main concern.

I cannot agree with my hon. Friend that the ISC should be a Select Committee, although I agree with the reasons why she would like it to be. There is a slight difference. She made a powerful case about the way in which the Committee could require rather than request information; we must remember that that information is totally different from any other information that any Select Committee of either House or both can require.

However, I fear that the journey from 1994 to where we are and where we are going will be a bit longer because we must maintain the enormous trust that has been built up over the last 20 years between the intelligence agencies and the ISC, so that there is no division between them in what can or cannot be seen. Making the Committee a parliamentary Committee is a good way of moving towards that.

There is also a practical reason. The resources demanded by the Committee would be much greater than those demanded by any other Select Committee in the House of Commons or the House of Lords. The secretariat, which we have just been discussing, would cost millions of pounds, and already does. Consider the nature of its work; its visits are private and often secret, and simply cannot be made public. I accept what my hon. Friend said—protecting members of the new ISC and its witnesses and extending Select Committee privileges to them is a huge problem.

For years, the former Member for Thurrock, Andrew MacKinlay, pursued me year in, year out. He would make the case and year in, year out it was a problem for the members of the Committee because, although we agreed with the thrust of transparency and accountability, we knew full well that the Committee’s effectiveness would be seriously curtailed and undermined if it were simply a Select Committee of both Houses. That is my worry.

My hon. Friend said she would not press the amendment to a vote, but she properly made valid points that I hope the Minister will answer. If the Committee does not have the privileges of a Select Committee, what will the general public think about it? I accept that that is the case, and I certainly could not support a vote to make it an ordinary Select Committee, but I do not think the matter will be pressed to a vote today. We are asking why the privileges and rights of Select Committees cannot be extended to members of the ISC in a special way.

Again, it is a pleasure to follow the right hon. Member for Torfaen, who sets out the historical context and background of the challenges involved in seeking to establish the ISC as a Select Committee of this House.

The hon. Lady is right in flagging up the fact that the ISC in principle could be established through relevant orders of the House. She highlighted the Standing Orders, and that the Clerk to the House has said that in  principle it might be possible. However, when we take the theoretical to the reality of the Committee’s existing work and its relationships with the intelligence agencies, we see that it would be difficult to achieve that without undermining some of the ISC’s key principles and operating relationships.

It is important to underline that, at times, the ISC holds very sensitive information, and the duty is on the Government to see that there are appropriate protections to make sure that such information is safeguarded. I am sure that we will come on to other amendments in due course, about reporting and the Prime Minister’s role in seeking redactions on reports. There is very good reason, therefore, to ensure that sensitive intelligence matters are not inadvertently disclosed to those who wish to cause this country harm. We have to be cognisant of those issues when considering how we best deliver on that public confidence in the work of the agencies.

I absolutely agree with the hon. Lady’s comments that paid tribute to the agencies’ incredible work. In my role, I feel privileged to see and understand the work that so many people engage in day in, day out, to keep this country safe. It is about how we do that in a way that provides effective scrutiny and ensures that there is growing confidence in the work of the agencies, which do so much to provide the security that is an intrinsic part of what we wish to see.

Our judgment, and that of the ISC, is that a Select Committee structure would not meet those overall requirements. That decision has not been made capriciously, but after careful thought and consideration. Our judgment is that the model set out in the Bill—a statutory Committee of Parliament—is the most effective way of taking the Committee closer to Parliament, making it more of a parliamentary Committee, to deal with the safeguarding issues that we touched on in previous debates. However, the issue is also about recognising that the Committee would not automatically gain parliamentary privilege, because it is a parliamentary Committee established by statute, as we touched on earlier.

We have been careful in the drafting to ensure that we do not cut across issues of parliamentary privilege. Again, that is why we have constructed the Bill in that way and why we have not sought to say that the Committee will gain parliamentary privilege through statute, for the important reasons that we debated and were reflected in the letter from the Clerk of the House.

The changes contemplated in the clause are important. They are the key policy objective that was outlined in the Green Paper: that the ISC’s link to Parliament should be strengthened, that there should be greater confidence in the ISC’s excellent work, and through that, that there should be greater assurance and confidence in the work of our intelligence agencies. Therefore, the proposed changes to the appointment of members and the right that both Houses would have on voting for the ISC’s members, as nominated by the Prime Minister, is a significant change, as is the accountability of the ISC to Parliament itself, in terms of underlining the ISC’s separation and independence from Government. Important reforms are reflected in the clause that significantly enhance the oversight arrangements that we have in place for our intelligence agencies.

The changes are expected to make the ISC a more effective, relevant body, in a parliamentary sense, which is important, so that along with our annual debate on the ISC’s report, its work will be seen to be tied to Parliament, as part of Parliament. The reforms in the Bill and the clause seek to strengthen that oversight and governance, which is why I hope that this Committee is minded to ensure that the clause stands part of the Bill.

Question put and agreed to.

Clause 1, as amended, accordingly ordered to stand part of the Bill.